WSJ: Even Warren Buffett Hasn’t Fixed the RV Industry’s Serial Breakdowns

WSJ: Even Warren Buffett Hasn’t Fixed the RV Industry’s Serial Breakdowns

Forest River, owned by Warren Buffett’sBerkshire Hathaway, is one of the RV industry’s Big Three, along with Thor and Winnebago. Over the past decade, those companies have reported more recalls than Detroit’s Big Three automakers, even though they make far fewer vehicles.

That’s lucky.  My Wolf Pup was made by Forest River.

I just checked the Forest River Recall Search page.  The only recall was for the fire extinguisher that came with my camper.  The plastic handle could break.

RVs have to operate as both houses and vehicles. The complexity of that production leads to more recalls, according to Forest River. Executives, consultants and analysts say the RV industry’s unique manufacturing practices also play a major role.

Cars are standardized.  There are a few parent companies, several brands, many models and a fixed number of colors and trim levels.  About 15 million cars are sold each year in the US, +/- 10%..  About half-million Ford F-150’s are sold each year.  If you bought a Ford F-150, there might be 10,000 people who bought a truck just like yours.  That economy of scale means that car companies can automate and optimize the assembly process.

RVs are standardized, but the numbers look much worse.  About a 400,000 RVs are sold in a year, but the total number can vary by +/- 50% based upon the economy.  There are three major parent companies, 280 manufacturers and 800 brands.  Each brand has many models and each model has a few floor plans. 

Jay Flight has 7% of the travel trailer market.  Jay Flight has 8 models, with a total of 73 different floor plans.  For a year where they sold 20,000 travel trailers, they built an average of 277 travel trailers of each floor plan.  That’s for the most popular brand.  For my particular travel trailer, there might have been only a couple of dozen built that year.

RVs are sold like cars, but are nearly as custom as houses.  Three times more houses are sold, than RVs, but 30 times more cars.  There isn’t enough volume to justify automation or optimization in RV manufacture.

I’ve done quite a bit of work to customize my Wolf Pup from Forest River.  I’ve been behind most of the panels.  Holes are hogged out to run pipes and no effort was made to clean up any debris.  Storage is at a premium in an RV, but little design effort goes in to utilize available space.

RVs are a tough market.  People expect a wide variety of choice and the fit and finish of a new house at a tenth of the price.  The RV may be used every day of the year or just a few days.  There may not be an easy answer to RV quality.